Adjudicating Officer RERA has power to award compensation or interest. Power to adjudge compensation is conferred upon the Adjudicating Officer and not upon the Authority
ABCAUS Case Law Citation
ABCAUS 3408 (2020) (10) HC
Important case law relied upon by the parties:
Habitech Infrastructure Limited Vs. State of U.P. and 2 others)
In this case a Writ Petition was filed praying for quashing the impugned order passed by Adjudicating Officer, Real Estate Regulatory Authority, * RERA ) along with quashing the impugned recovery certificate issued.
It was also alleged that the proviso to Section 43(5) of Real Estate (Regulation & Development) Act, 2016 is arbitrary, ultra vires to the constitution being in conflict and contradictory to the spirit of the Real Estate (Regulation & Development) Act, 2016.
The petitioner was the promoter within the meaning of Section 2(zk) of the Real Estate (Regulation and Development) Act, 2016 (Act, 2016).
The petitioner entered into builder-buyer agreement with the respondents. Undisputedly, the petitioner was under a contractual obligation to handover the flat to the respondent within 30 months from the date of agreement. A grace period of 180 days was also provided in the agreement. Thus as per agreement the petitioner was liable to handover the flat complete in all respect to the respondents within 36 months i.e. three years.
However, the petitioner could not complete and handover the possession of the flat to the respondents within the agreed time and thus violated provisions of Section 18 of the Act, 2016. The actual possession of the flat was received by the respondent after more than three years.
Since the petitioner violated the provisions of Section 18 of the Act, 2016, therefore, the respondents filed an application before the authority as defined in Section 2(i) of the Act, 2016 claiming compensation and interest.
Since the respondents have claimed compensation also, the matter came before the Adjudicating Officer under Section 71 of the Act, 2016. The Adjudicating Officer passed the impugned order awarding compensation and interest.
Aggrieved by the aforesaid impugned order, the petitioner filed a writ petition under Section 226 of the Constitution of India alleging inter alia that Adjudicating Officer under Section 71 of the Act, 2016 has no power to award interest and compensation, in the event possession of the flat has been taken by the allottee from the promoter.
The Hon’ble High Court observed that Section 71 of the Act, 2016 confers power upon an Adjudicating Officer to adjudge compensation under Sections 12, 14, 18 and 19. Sub-section (3) of Section 71 provides that if the Adjudicating Officer is satisfied that the person has failed to comply with the provisions of any of the sections specified in Sub-section (1) he may direct to pay such compensation or interest, as the case may be, as he thinks fit in accordance with the provisions of any of those sections.
The Hon’ble High Court opined that by the impugned order the Adjudicating Officer had awarded compensation and interest as provided under Section 71 of the Act, 2016 for breach of provisions of Section 18 of the Act, 2016. Thus, the impugned order was not without jurisdiction.
Thus the Hon’ble High Court rejected the submission of the Petitioner and held that the impugned order passed by the Adjudicating Officer did not suffer from lack of jurisdiction.
The Hon’ble High Court stated that Section 38(1) of the Act, 2016 confers power upon the ‘Authority’ to impose penalty or interest in regard to contravention of obligations cast upon the promoters, the allottees and the real estate agents under the Act, Rules and Regulations. Power to award compensation or interest has been conferred under Section 71(1)/(3) of the Act, 2016 upon an Adjudicating Officer for adjudging compensation under Section 12, 14, 18 and Section 19 of the Act, 2016. Thus, the power to adjudge compensation has been conferred upon the Adjudicating Officer and not upon the Authority. Therefore, the impugned order passed by the Adjudicating Officer adjudging compensation is well within the four corners of the Section 71 of the Act, 2016.
Consequently, the writ was dismissed
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